CONSUMER SOCIAL CLASSES CHAPTER 4: ENVIRONMENTAL INFLUENCES:Shopping Groups

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Consumer Psychology (PSY - 514)

LESSON27

CONSUMER SOCIAL CLASSES

CHAPTER 4: ENVIRONMENTAL INFLUENCES

Understanding:

· Shopping groups

· Celebrity and other reference groups

· Family as group

Shopping Groups

Two or more people who shop together, whether for food, clothing or simply to pass the time can be called a

shopping group. Such groups are often the offshoots of family or friendship groups and are often called purchase

pals

Motivation for Shopping with Purchase Pals

Shopping with groups could be a pleasant experience because of different types of motivations including:

Social Motive :To spend time together and enjoy lunch after shopping

Risk Avoidance: (Reduce the risk while making an important decision)

Reducing the Error: (Have someone whose expertise will reduce the chance of making an incorrect

purchase)

None of the members knows about the product under consideration

Defensive Reasons: Members may feel more confident with collective decision

In-Home Shopping Party

Group that gathers together in the home of a friend to attend a party devoted to demonstrating the features of a

specific line of product

Benefits of In-home Shopping Party

The features of a product can be marketed to a group of potential customers. Early purchasers tend to create a

bandwagon effect. Undecided guests often overcome a reluctance to buy when they see their friends make positive

purchase decisions. Some guests may feel obliged to buy because they are in the home of the sponsoring host or

hostess.

Customer Referral Program

Customer Referral Programs make use of elements of shopping behavior that take into account the group

dynamics. It usually focuses on Member Gets Member (MGM) Campaign. Current customer is asked to persuade

other members to become members. For example Membership Clubs of the Hotels

Work Groups

Workgroups consist of people who work together. Workgroups serve a major influence on consumer behavior of

members

Formal Workgroups consists of the individuals who work together as part of team and thus have sustained

opportunity to influence each other's consumption related actions and attitudes

Informal Workgroups consists of people who have become friends as a result of working for the same company,

whether or not they work together as a team. Members of informal workgroups may influence the behavior of

other members during coffee or lunch breaks or after work meetings

Virtual Group Communities

Consumer Psychology (PSY - 514)

Web based consumer groups. Such groups/communities provide access to members with ample information,

fellowship, and social interaction covering an extremely wide range of topics and issues (e.g. vegetarianism,

cooking, trading, electronic equipments, software, matchmaking, technology, etc...)

Evolution in the Definition of Communities

50 Years ago definition of community stressed the notion of geographic proximity and face to face relationship,

today community is much more broadly defined as sets of social relationships among people.

On the internet It does not matter who you are. People are free to express their thoughts.

Be emotionally intimate with those they don not know at all. The anonymity on the web gives its user maximum

freedom. Communicating on the internet makes people explore the boundaries of their personalities and shift

from one persona to the other. The exchange of knowledge that can take place within a virtual community can

help a good product sell faster and poor products fail faster.

Brand Communities

Specialized non-geographically bound community, based on a structured set of social relationships amongst

admirers of a brand ... It is marked by a shared consciousness, rituals and traditions and sense of moral

responsibility.

Marketers some time design specific product or service to create a sense of community or take advantage of pre-

existing relationships (e.g. offer to members of a family and relatives or friends, or even people doing business

with each other). Runners get together at Nike town store. Saturn automobile reunions and barbeques, Jeep

owners.

Consumer Action Groups

Groups dedicated to providing consumers with assistance in their effort to make the right purchase decisions,

consume services and products in a healthy and responsible manner and generally add to the quality of their over-

all lives

Categories of Consumer Action Groups are those that organize to correct specific consumer abuse and then

disband it. They organize to address broader more pervasive problem areas and operate over an extended or

indefinite period of time.

Examples may be group of neighbors who meet with local highway departments to demand additional stop signs

be placed on specific corners in their residential neighborhoods. It could be group of parents who band together

to protest the sale of cigarettes to the minors in their neighborhoods.

Celebrity and Other Reference Group Appeals

Celebrities can be a powerful force in creating interest or actions with regard to purchasing or using selected goods

and services

Types of Reference Groups in this regard include:

· Celebrity Appeal

· Expert Appeal

· Common Man Appeal

· Executive and Employee Appeal

· Trade or Spokes Character Appeal

1. Celebrity Appeal

Celebrities mostly include:

· Movie Stars

· TV Stars

· Entertainers Sports Icons

Consumer Psychology (PSY - 514)

Entertainers

According to an estimate about 25% of advertisements include celebrities. Advertisers spend enormous sums of

money to have celebrities to promote their products with the exception that the reading or reviewing audience will

act positively to the celebrity's association with their product. Famous people hold the viewers' attention.

Examples

Michael Jordon Under contract with NIKE till 2023

· Tiger Woods has a five year contract with Buick , estimated at $ 30 Million

· Tiger Woods also with NIKE where his deal is going to rise up to $ 80 Million

· David Beckham signed a contract with Gillette worth $ 68 Million

Celebrity Credibility

Audience's perception of the celebrity's level of expertise in endorsing a product is considered important by the

target consumers. It matters to them that

How much the celebrity knows about the product area

How hones the celebrity is about what he or she says about the product)

2. Expert Appeal

A person who because of his/her occupation, special training, or experience is in a unique position to help the

prospective consumer evaluate the product or service that the advertisement promotes.

Example

· Advertisement of a quality Oil may feature the endorsement of a chef

· The advertisement of a toothpaste endorsed by a dentist

· The advertisement of a car leasing plan endorsed by a financial analyst

3. The Common Man Appeal

Reference Group Appeal that uses the testimonials of satisfied customers is known as the Common Man

Approach.

Examples

A Middle aged humble and innocent lady endorsing a financial savings plan

· NIKE Sneakers Ad taking the common youngsters playing cricket on the roof tops of the buses

Advantage of the Common Man Appeal

The Common Man Appeal demonstrates to the prospective Customer that some one just like them uses and is

satisfied with the product or service being advertised. Common Man Appeal is especially effective in public health

announcements. Most Television Commercials show a typical person or family solving a problem using the

advertised product/service.

4. Executive-Employee Spokesperson

Increasing number of companies has shown their CEO's in the advertisements.

5. Trade or Spokes Character Appeal

Characters created by the company to endorse their products, E.g. Ninja Turtles, Commander Safeguard, etc..

Other Reference Group Appeals

· Respected Retailers

· Editorial Content of Special interest magazines

· Fashion Magazines Endorsements (Fashion Designers)

· Seals of Approval (Medical/Pharmaceutical products, ISO certifications, etc...)

Consumer Psychology (PSY - 514)

Family

Key Family Consumption Roles include:

· Influencers:

Family members who provide information to other family members about the product/service

· Gatekeepers

Family Members who control the flow of information about a product/service in the family

· Deciders

Family Members with the power to decide unilaterally or jointly whether to shop for, purchase,

use, consume or dispose of a specific product/service

· Buyers

Family members who make the actual purchase of a particular product/service

· Preparers

Family Members who transform a product into a form suitable for consumption by other

members

· Users

Family Members who use or consume a particular product/service

· Maintainers

Family members who service or repair the product so that it will provide continuous satisfaction

· Disposers

Family Members who initiate or carry out the disposal or discontinuation of a product /service

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